The mine will serve a 19-year, 65Mt coal supply agreement for Arizona Public Service Company's Cholla Generating Station near Joseph City, Ariz.

The mine will also supply Tucson Electric Power Company's Springerville Generating Station through a long-term contract that runs to 2020.

El Segundo is the fourth major mine that Peabody has completed in the past year.

The mine is located adjacent to Peabody's Lee Ranch Mine and is the first new coal mine developed in New Mexico in more than two decades.

Both El Segundo and Lee Ranch ship coal to customers via the Burlington Northern Santa Fe and Union Pacific railroads.

Together the mines employ nearly 265 workers and will annually inject more than $85 million in direct economic impacts into the region in wages and benefits, vendor contracts and taxes, implying a total economic benefit of nearly $350 million, Peabody said.